Established as a trade and import company for food stuff by Mr. Elia Nuqul in 1952, the Nuqul Group began its paper converting operations in 1958. With IFC’s support through four projects since 1990, the Nuqul Group has grown from a family-run Jordanian conversion operation into a leading regional integrated manufacturing corporation focusing on hygienic paper products (facial tissues, diapers, feminine pads, table napkins, toilet rolls) with operations in 9 countries and selling its products across the Middle East region. The Nuqul Group is wholly-owned by its founder and his family.

The proposed conversion capacity expansion and potentially energy and water efficiency project represents a total consideration of approximately $67 million of which $30 million would be provided by IFC in the form a of 10-year amortizing corporate loan.

30.0 million (USD)

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	30.0
Equity

* These investment figures are indicative

The project consists in financing the acquisition of new machinery to equip (i) a new conversion plant in an industrial area in 6 October in Egypt, close to Nuqul’s Egyptian paper mill; (ii) the extension of a conversion plant in the outstrips of Amman; and (iii) potential water and energy efficiency improvements across the Nuqul Group’s mills in Egypt and Jordan.

Improved economic resilience: The expansion of conversion capacity in the host countries of the project (namely Egypt and Jordan), will help support the local economic environment by decreasing reliance on typically more expensive and volatile imported goods. Additionally, the manufacturing focus of the project will support diversification of the economy in the countries where the new capacity will be established. The project will also enable Nuqul to increase its internal consumption of jumbo tissue rolls and focus its sales on higher-margin finished products, thereby improving its operational performance and resilience. Spread of world-class business practices: Over the past years, Nuqul has made significant progress on the path to institutionalization notably in separating ownership and management as well as implementing world-class corporate governance and business practices. The Nuqul Group is a highly respected institution across the MENA Region and the project will enable Nuqul to spread its commendable business practices by expanding the Group’s regional reach. Benefits of regional integration: The project will facilitate increased trade linkages within the region and serve as an example to other players of the rewards available from global integration. Improved living standards for the populations: The project will create sustainable employment opportunities in countries where youth unemployment is a major issue. Domestic and efficient operations will enable the Nuqul Group to bring more affordable quality products in the market, thereby improving the local populations’ access to products catering to basic human needs. Demonstration effect: By providing long term financing in markets where these types of financing are typically not available, IFC sets a long term interest rate benchmark for commercial loans of longer tenors. This may lead to the eventual development of a long term interest rate curve in the local market and enable local lenders to provide these types of financing. Cleaner production support: The project will support the Nuqul Group’s efforts to move towards cleaner production, thereby contributing to decreasing the Group’s environmental footprint.

Provide long-term countercyclical funding: The project will provide longer tenors than what is currently available on the market. Besides, because of the global financial crisis, credit availability across the MENA region has been reduced. Advisory services: IFC’s Advisory Services is supporting Nuqul’s initiative to move towards cleaner production through the design of a comprehensive roadmap aimed at identifying and quantifying energy and water efficiency gains across the Group’s production facilities. Maximized impact with a longstanding client: Nuqul has been a client of IFC since 1990 and this project would represent IFC’s fifth investment with the Group. Along years of cooperation, IFC has developed a strong relationship with the Nuqul family which enables our institution to maximize its developmental impact as the Client’s trust in our global knowledge improves our influence on the Group’s way of doing business.

Key environmental and social risks and impacts include social and environmental assessment of Nuqul’s proposed expansions in Egypt and Jordan; Group Standard Manual (EHS) management system covering all operations; labor management and working conditions for permanent and contract employees; recycling, treatment, and discharge of process effluent and air emissions; efficient management and monitoring of energy and water use across operations; waste minimization, recycling and reuse; consultations with communities impacted by operations to be financed; and risk assessment and emergency preparedness. As an existing IFC client (since 1990), Nuqul has demonstrated strong performance on environmental, social and health and safety issues over the life of IFC’s investments. Nuqul will utilize the same Environment, Social and Health and Safety management systems and procedures in the Egypt operation as it has implemented successfully in its Jordan operations, which comply with IFC and good industry standards. A detailed description of IFC’s environmental and social due diligence of this investment can be found in the Environmental and Social Review Summary (ESSRS), which is also available on IFC’s website at http://www.ifc.org/projects